Chain Drug Review, August 26, 2019

PERSPECTIVES FRONT END CHAIN DRUG REVIEW 2019 People are increasingly linking diet to health By Sarah Schmansky The self care movement is playing a key role in reshaping health care in a way that drug store retailers and manufacturers cannot afford to ignore Recent data from The Conference Board Global Consumer Confidence Survey in collaboration with Nielsen shows that 18 of Americans reported health as a top concern next only to the economy 22 and immigration 19 With the threat of rising health care costs consumers are prioritizing wellness and taking a more active role in managing their own health Todays health minded consumers are looking beyond medicine to manage their health and opting for healthier food is a big part of this mindset Increasingly for drug stores the way to the consumers wallet is through their diet However Nielsens 2019 Health Care Study showed that only 24 of consumers are satisfied with the health food selection in drug stores compared to 75 who expressed satisfaction with the health foods sold in traditional grocery stores Within the drug store market there is a golden opportunity for growth The first step is to understand the diet trends currently at play How well versed are you in todays diverse diet landscape Here is a quick snapshot What is America eating and not eating in 2019 As a whole consumers care about both whats in and whats not in their diets In 2019 consumers are making more room on their plate for fresh fruits vegetables and wholesome food driven by diets such as Whole30 keto and vegetarianism which is currently seeing the secondhighest absolute dollar growth of 24 billion While fresh produce sales at the drug store level are limited manufacturers are making efforts to include more fruit and vegetables in their products in order to appeal to consumers looking to increase their consumption of healthier better for you food and beverages That said small convenience items containing fresh produce are viable and smart options for drug retail Snackable produce is a trend we called out in 2017 where at the time this on thego snacking subcategory was a 11 billion area with a compound annual growth rate of more than 10 every year between 2012 and 2016 within grocery retail In terms of what consumers are cutting back on so far in 2019 diets that are low sugar low carb and low in sodium are trending meaning that an increasing number of consumers are cutting out sugar highly processed carbs and sodiumrich food Popular diets like the paleo or caveman diet require consumption of foods presumed to have been available to humans during the paleolithic era so basically anything that looks like it came from a factory is off the table While cholesterol friendly diets like Dash and low glycemic diets are both losing dollar sales and momentum Nielsen data shows that there has been a notable increase of consumers following keto microbiotic and Sarah Schmansky paleo style diets And of all of diets that have trended this year the one you should have most on your radar is the keto diet What is the keto diet The ketogenic diet is a very low carb high fat diet that shares many similarities with the Atkins and low carb diets It involves drastically reducing carbohydrate intake and replacing it with fat This reduction in carbs puts the body into a metabolic state called ketosis The keto diet typically includes meat fish eggs butter nuts healthy oils avocados and plenty of low carb veggies Consumers on the keto diet aim to avoid carb based foods like grains sugars legumes rice potatoes candy juice and even most fruits There are several versions of the keto diet The standard SKD version is the most researched and most recommended Who is the keto shopper According to Nielsen data 46 of consumers who are following the keto diet are living in households with annual incomes over 100000 and 87 of keto shoppers are Caucasian The majority of followers 42 are from smaller households of two members With this broad understanding of the diets that are driving consumer food preferences it is just as important to gain visibility into what food attributes are driving purchase decisions at the shelf While many of the top attributes mirror the leading diet trends low sugar low fat high protein and low sodium Nielsens 2019 Health Care Study shows that consumers also value attributes like heart health 58 natural 51 free from artificial ingredients 50 and vitamin mineral presence 47 As mentioned for drug stores the way to consumers wallets is through their diet There is a need for drug store retailers to reimagine their health food selection An aversion to processed foods and an opportunity to do a better job in addressing the specific needs of todays dietary needs and trends Understand the trends Identify the attributes and ingredients that are driving growth in your business and recognize that health and wellness is not one sizefits all As consumers take a more proactive interest in their own health and wellness it will be crucial for drug store players to understand the need across all inclusive of generations income ailments and diets Sarah Schmansky is vice president of Nielsens Health and Wellness practice Trending Diets LOW SUGAR 27 25 25 24 19 16 16 16 15 12 10 09 08 08 07 07 05 05 LOW CARBOHYDRATE LOW CALORIE NO SUGAR MACROBIOTIC PALEO VEGAN PLANT BASED DASH YOUNGER YOU CASIEN FREE VEGETARIAN HIGH POTASSIUM IRON RICH ATKINS 40 HIGH PROTEIN LOW SODIUM PESCATARIAN LOW FAT Source Nielsen Retail Measurement Services Product Insider Characteristics Total U S xAOC 52 weeks ended 5 4 2019 The buzz around cannabis in beauty and wellness Continued from page 43 even Charlotte Web Paws a product for pets paws joints and hips The company offers a discount program to veterans of the U S military The suppliers cannabis health and wellness products are sold online and in specialty retail stores and its target audience is an athletic fit consumer The beauty brand Malin Goetz developed by cofounders Matthew Malin and Andrew Goetz consists of products made from natural ingredients The company uses cannabis in candles hand soap lotion and fragrances The brands first shop opened in New York Citys Chelsea neighborhood and it now has locations worldwide The founders say their formulas for the care of sensitive skin were developed together with scientists and chemists Drug store retailer CVS introduced CBD infused products at its stores in eight states earlier this year and shortly thereafter Walgreens said it will introduce CBD products at 1500 stores in about 10 states later this year Consumer interest U S consumers are more inclined to try food infused with cannabis ingredients than beauty products infused with cannabis A February 2019 survey of U S adults over age 21 found that 54 are likely to try foods with CBD and 37 are open to trying foods with THC Only 39 are inclined to try beauty and skin products with CBD while 22 would try products with THC Among retail channels drug stores are the most popular choice for purchasing CBD products indicating that consumers likely trust drug stores more than other retail channels for these products Nearly half of U S consumers say they have bought CBD products from drug stores while 43 have bought them from general online retailers according to a survey by convenience store magazine CSP and consulting firm Technomic Consumer interest in cannabis infused products is growing At the Cosmoprof North America beauty conference we attended last August the general consensus among participants and brands was that cannabis products are going to explode within the next few years and in the words of one attendee cannabis will be like lavender within five years There is a huge white space for retailers to tap into this growing demand although navigating the legal landscape can be tricky Retailers should of course investigate products and their ingredients thoroughly to ensure they are permissible for sale But in the meanwhile they can look to working with the growing number of brands that are finding innovative uses for CBD in their products to initiate meaningful conversations regarding its potential benefits and equip consumers with better information Deborah Weinswig is founder and chief executive officer of Core sight Research She can be contacted at Doborah Weinswig@ coresight com 48 Chain Drug Review August 12 2019

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